CGT and ltd company shares

[MrRobin]

This may be a very dumb question and I may get a barrage of abuse but...

Everyone has a £8,800 CGT personal exemption allowance. What is to stop me making good use of this by selling 1 of my company's shares (bought for £1 each) for £8,801, back to the company? -- Effectively extracting almost 9k from the company tax free.

[Gonzo]

This may be a very dumb question and I may get a barrage of abuse but...

Everyone has a £8,800 CGT personal exemption allowance. What is to stop me making good use of this by selling 1 of my company's shares (bought for £1 each) for £8,801, back to the company? -- Effectively extracting almost 9k from the company tax free.

IANAA IANAL

But, to my mind the first pitfall that would need to be overcome is whether that share is worth £8,801. If it is not then as a Director I think you would be breaking company law by overspending company money to line your own pocket.

[THEPUMA]

Unless certain criteria are satisfied, the default tax position of a purchase of own shares by a company is that the excess over cost is treated as a dividend.

Amongst other things, one of the criteria is that your interest in the company (including that of your associates - including your close family) is reduced below 5%.